Buying directly from producers: how specialty food shops owners build their suppliers list

Abstract

1. PURPOSE
Rural food producers, especially small-scale farmers and artisans, often face difficulties in accessing market conditions that provide them enough income to ensure the sustainability of their businesses and the communities they live in. Though the literature on Short Food Supply Chains has highlighted potential economic, social, and environmental advantages of short direct links between market actors (Vittersø et al. 2019), there is insufficient research on urban specialty shops’ possible contribution to establishing direct sourcing relations. We aim to identify the main reasons used by shop owners to justify buying directly or not from producers, and what are their strategies for building direct sourcing networks.
2. METHODOLOGY
This research is based on a round of 30 interviews conducted in shops of three Portuguese cities (Aveiro, Lisbon and Porto). The 30 shops were randomly selected by city and classification according to a hierarchical cluster analysis of 113 surveyed shops, based on the most sold products, that identified three clusters: ‘The Wine Focused’, including shops mainly commercializing wine; ‘The Rural Provenance Focused’, integrating shops selling mainly rural provenance food products and ‘The Generalist’, including shops commercializing a wide range of products from diverse provenances (Silva et al., 2021). Interviews were conducted between November 2019 and February 2020 with shop owners or shopkeepers when the latter were more familiar with the shops’ daily operations. The interview included topics related to shop characterization, sold products characterization, shop customers, reasons for selling rural provenance products and commercialization strategies. Interviews were analysed thematically and, for this study, analysis focused on the categorization of descriptions of ties with suppliers, whether directly to producers or through intermediaries.
3. FINDINGS
Interviews with shop owners suggest a very diversified characterisation of producer-seller relations, that ranges from dependence on pre-existing networks to active pursuit of new connections, and from full reliance on distributors to exclusive links with producers. There are specificities of products in this regard, and not all decisions are encompassing but instead based on the characteristics of products and producers. Decisions to pursue direct links with producers are justified by immediate economic advantages of reduced costs, but also explained as a way of gaining access to better quality or exclusive products, the building of closer and more trustful relations, or by the value of personal and meaningful contacts.
Positioning themselves in niche markets for specialty foods, and sometimes making efforts to build new relations with producers, shops act in an already structured context of supply networks that conditions opportunities for and the viability of direct relations. Pre-existing networks include contracts between producers and distributors that can specify exclusivity, the existence of transport channels operated by intermediaries or by the producers themselves, often tied to constraints of geographical proximity and scale. Shop owners mention some of these “hard” conditions explaining that, at least for some products, reliance on direct or indirect supply is a matter of fact and not of choice.
In cases where these constraints are softer, the decision can be based on a comparison of immediate economic advantages, and often shop owners mention lower costs of product acquisition through direct sourcing which can be dependent on the arrangements and prices for transportation. This type of immediate economic choice is at times justified with the indifference of preferred attachments, such as equal trust, between distributors and producers. Other times the choice is weighted with other factors such as access to better quality or more complete knowledge about a product’s quality. Shop owners mention knowledge about production processes but also about stock and quantities that can be used to better scheduling of their orders. For some shops and in the case of some products direct relations also entail personal connections with producers that may be developed through searching for new contacts or be based on already existing networks that can include family members and friends. Shop owners act sometimes as part-time explorers, traveling to look for new products and create close networks that can be exclusive and even non-disclosable, linking disinterested motivations of meaningful relations and friendship to more economic reasonings of regulating scarcity through narratives of authenticity (Gerosa, 2021).
4. CONCLUSIONS AND RESEARCH LIMITATIONS
1. Shop owners’ do not always frame their sourcing practices as decisions between competing alternatives. Their justifications for establishing direct links to producers are varied and include cost advantages and more indirect economic motivations as well as non-economic reasons. Results suggest that there are different constraints for developing direct links for different product types. ORIGINALITY
This contribution is original and was not present elsewhere.
2. REFERENCES
Gerosa, A. (2021). Cosmopolitans of regionalism: Dealers of omnivorous taste under Italian food truck economic imaginary. Consumption Markets & Culture, 24(1), 30–53. https://doi.org/10.1080/10253866.2020.1731483Vittersø, G., Torjusen, H., Laitala, K., Tocco, B., Biasini, B., Csillag, P., de Labarre, M. D., Lecoeur, J.-L., Maj, A., Majewski, E., Malak-Rawlikowska, A., Menozzi, D., Török, Á., & Wavresky, P. (2019). Short Food Supply Chains and Their Contributions to Sustainability: Participants’ Views and Perceptions from 12 European Cases. Sustainability, 11(17), 4800. https://doi.org/10.3390/su11174800
Silva, A.; Figueiredo, E.; Truninger, M.; Eusébio, C. and Forte, T. (2021). ). A typology of urban specialty shops selling rural provenance food products – a contribution from Portugal. British Food Journal, 123(12): 3902-3917. https://doi.org/10.1108/BFJ-11-2020-1045.